Jared Kaplan: The power of the model is that it enables the customers to tell the story. We have done a tremendous job in providing access. We know that because we try to give the business away when someone applies. It’s a time and a process. Let’s say they go to Google and they type, “Car broke down. Need cash.”
They fill up the application for five minutes. Before we send that data to the banks, we send the data to 15 prime lenders to see if anyone wants the business upfront. 92% of the time, no one returns an offer.
It is that process where you go and do a diligent search on the customer’s behalf and only when you can’t find a better option there that you look to underwrite them through the banks into this higher-cost product. It’s changed the way that people have viewed the industry because it is the best way to get someone to get the best product.
Sramana Mitra: Are you familiar with the company called RentMoola?
Jared Kaplan: No, I am not.
Sramana Mitra: I did a story recently with them. If you go to our blog you will see their case study. It is also a Thought Leaders on Financial Technology interview series. They provide FinTech for the real estate industry for landlords and large apartment complexes.
I was talking to the CEO that there is a tremendous eviction crisis coming on. It is already ensuing actually. This is going to screw up people’s credit histories. I wonder if there is a partnership for you to create with a company like RentMoola so that you can help people get back on their feet after COVID.
Jared Kaplan: We were approached by a similar proposition. You are on to something. That is a huge opportunity. It’s got bigger macro trends as well because the traditional credit score system is in some ways inflated now. There are a lot of people who rely on the traditional credit score that don’t trust them as much as they used to.
That will be a problem and may make some other lending platforms a bit more risk-sensitive. There will be events that hurt people’s credit but determine what their profile should be. There will be other maturations of that where we can be helpful because of the way we think through what riskiness looks like.
Sramana Mitra: There are whole industry sectors that have gotten demolished in COVID. Some of these are the airline industry, retail, restaurants, and hospitality. These people are going to start climbing back from that hole and there is something that can do there.
Thank you for your time.